Columbia Metal Culvert Co. v. Kaiser Industries Corp.

APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA D.C. Civil No. 74-122

Seitz, Chief Judge, Rosenn and Garth, Circuit Judges.

Author: Rosenn

Opinion OF THE COURT

ROSENN, Circuit Judge

The reach of Pennsylvania's "long-arm" statute has been expanded by successive amendments since 1968.*fn1 The last amendment in 1972, 42 P.S. § 8309(b) (Supp. 1975), enlarged jurisdiction over foreign corporations to the broadest extent permissible under the United States Constitution. The case before us requires an interpretation of the law in its present form as it pertains to personal jurisdiction over non-resident individuals.*fn2

Columbia Metal Culvert Company, Inc., ("Columbia"), a New Jersey corporation, instituted an antitrust suit in the United States District Court for the Eastern District of Pennsylvania*fn3 against Kaiser Industries Corporation,*fn4 a Nevada corporation, and several of its affiliated corporations (collectively referred to as "Kaiser"), Kennedy Culvert and Supply Company ("Kennedy Company"), a New Jersey corporation, and Robert A. Kennedy individually, a New Jersey resident.

Columbia alleged in its complaint that Kaiser conspired with Kennedy "to leave Columbia's employ, without notice, and to begin immediately thereafter, selling, in competition with Columbia, Kaiser Aluminum's products." Columbia asserted that Kennedy was transacting business in Pennsylvania and invoked Pennsylvania long-arm jurisdiction over Kennedy pursuant to Fed. R. Civ. P. 4(d)(7)*fn5 and 42 P.S. § 8301 et seq. (Supp. 1975). Substituted service was made by mail on the Secretary of the Commonwealth of Pennsylvania pursuant to 42 P.S. §§ 8304 and 8307 (Supp. 1975).

Kennedy moved to dismiss the action for lack of jurisdiction and for lack of venue. The district court dismissed the action against Kennedy for lack of jurisdiction, concluding that there were insufficient activities by him within Pennsylvania to meet the requirements of the long-arm statute. Columbia timely filed a motion for reconsideration alleging that facts revealed in Kennedy's deposition in discovery proceedings, the transcript of which had become available only after the district court's order dismissing the action against Kennedy, established jurisdiction. The court denied the motion. Columbia appeals from both that order and the prior order of dismissal.*fn6 We reverse the district court's judgment in favor of Kennedy.

Although the district court did not discuss venue in its memorandum decision dismissing Kennedy for lack of jurisdiction, Columbia raised the matter of venue on appeal. We believe that it is for the district court in the first instance to determine the propriety of venue in the Eastern District of Pennsylvania and thus do not reach this issue here.

I.

In our search to ascertain whether the district court acquired jurisdiction over Kennedy, we must determine whether service was effectively made under Pennsylvania's most recent amendment to its long-arm statute, 42 P.S. § 8304 (Supp. 1975). That statute permits substituted service on any nonresident individual who was doing business in Pennsylvania on or after August 30, 1970, "at the time the cause of action accrued or the harm or financial loss occurred." 42 P.S. § 8304 (Supp. 1975). The pertinent provisions of 42 P.S. § 8309 (Supp. 1975) define "doing business" as follows:

(a) Any of the following shall constitute "doing business" for the purposes of this chapter:

(1) The doing by any person in this Commonwealth of a series of similar acts for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object.

(2) The doing of a single act in this Commonwealth for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object with the ...

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